Monday, April 28, 2014

Proposed legislation seeks to boost construction of local manufacturing space

Dandelion Chocolate workers Molly Gore, left, and Karen Murphy use a machine to shake the bubbles out of tempered chocolate. The company is seeking more space in The City.

San Francisco may draw much attention due to its technology innovation, but another growing industry is fighting to remain vital despite soaring real estate costs and lack of space — local manufacturing.

With products ranging from ceramic tiles to chocolate, San Francisco’s diverse local manufacturing industry is praised for diversifying the local economy and providing blue-collar jobs. But the growth of the industry remains a challenge.

Legislation approved Monday by the Board of Supervisors Land Use and Economic Development Committee aims to encourage the construction of manufacturing space by amending the 2008 zoning laws for eastern neighborhoods to promote additional construction in the area. One proposal would allow for office space development in manufacturing areas if 33 percent of the new space is for local manufacturers.

As the booming tech industry in The City has gobbled up real estate and sent its prices soaring, the proposal is intended to provide some relief to businesses looking to expand, stay afloat or embark on their first ventures.

Greg D’Alesandre, owner of Dandelion Chocolate at Valencia and 18th streets, said he has been looking for space to expand and double his 38-member workforce for the last six months, but to no avail.

“A lot of chocolate makers have been in San Francisco. All of them have moved out because none of them have been able to find the space that they need,” he added. Tcho, a chocolate manufacturer, announced in February there was no local space to accommodate its growing business and moved to Berkeley.

Other businesses have also expressed interest in expansion, including bike messenger bag manufacturer Timbuk2, which has been in the Mission district for 25 years.

Some economists believe the demand for space has marked the resurgence of local manufacturing in San Francisco and nationwide. But Kate Sofis, executive director of SFMade, an organization promoting local manufacturing, said it’s still a troubling time for the industry.

“We really are at a crossroads right now where we are both growing the sector but we actually have started to lose manufacturers for the first time,” she said.

The proposed ordinance is strongly supported by local manufacturers. And community advocates wary of the adverse impacts of permitting more office development were mostly appeased with several amendments made during the past 18 months since the legislation was first proposed.

An outstanding issue is whether to cap the amount of office space allowed at 50 percent for developments containing so-called small-enterprise workspaces — 1,500-square-foot incubator spaces — to avoid conflicts between manufacturing and tech startups. Supervisor David Campos said he plans to propose that amendment when the law is voted on by the full board May 6.